List of All Stablecoins
June 2023

What are stablecoins?

Stablecoins are cryptocurrencies with stable prices pegged to real-life assets in a 1:1 ratio. They are meant to provide stability in cryptocurrency markets. Even the major cryptocurrencies such as Bitcoin, Ethereum, and BNB prices are highly volatile. It is very usual to see %50 drops or %100 gain in prices.

Why are stablecoins used for?

The biggest advantage of stablecoins is that they can be accepted as a store of value coins. Their prices are stable and you can still earn interest by lending or holding them in a saving account. You can compare saving platforms by using our Crypto Portfolio Optimiser. Crypto saving platforms offer very competitive high rates compared to traditional banks.

The second important advantage of stablecoins is they are used as a medium of exchange. They are very cost-efficient and fast in terms of transferring funds. You can easily transfer money internationally in seconds at a very low cost.

What are the real-life assets with a digital stablecoin?

The USD dollar is the most used fiat currency in the world and its stablecoins are the same in crypto markets. Dollar stablecoins such as USDT, USDC, BUSD, and UST are the most used stablecoins. The first stablecoin is Tether (USDT) which was created back in 2014 and since then there are different types of stablecoins pegged Dollar prices in a 1:1 ratio. There are also other stablecoins pegged to gold, silver, and copper prices. PAXG is the most used gold-pegged stablecoin in the markets.

How many stablecoins are there?

There are tens of stablecoins provided by different companies and platforms. Here are listed the most used stablecoins and their origins.

USDT

USDT is the most widely used stablecoin and was known as Realcoin back in 2014 when it was first created. Tether is created by Brock Pierce with Reeve Collins and Craig Sellars. Brock Pierce is a well know figure in the blockchain industry. He was elected Director of Bitcoin Foundation which is a nonprofit corporation to promote and contribute developments for Bitcoin. He is also one of the founders of the Blockchain Capital with Bart Stephens, Bradford Stephens. Blockchain Capital is the oldest and most active venture capital company investing in blockchain technologies. Brock Pierce told that his involvement in Tether ended in 2015 and it is one of the most important innovations in the blockchain industry. Now, Tethers are created by Tether LTD company based in Hong Kong. USDT stablecoins are created as an Omni layer on Bitcoin, as ERC-20 tokens on the Ethereum network, and the same way on other major blockchains. USDT is the third-largest market cap cryptocurrency after Bitcoin and Ethereum. It is by far the most used stablecoin.

The company is required to hold dollar deposits equal to the amount of USDT they issued. But it is unclear if the company has enough assets to cover %100 of Tethers on the market. The company announced that Tether is %100 backed by multiple assets. The company hasn’t stated itemized explanation of multiple assets they are holding.

USDC

USDC is the second biggest stablecoin and fifth biggest cryptocurrency by market cap after Bitcoin, Ethereum, USDT, and BNB. USDC is created in 2018 by a consortium that was founded by Circle in a corporation with leading cryptocurrency exchange platform Coinbase and Bitcoin mining company Bitmain.

Coinbase is a San Francisco-based and Nasdaq-listed cryptocurrency exchange and financial services company. Coinbase is a well-known authority in the crypto and blockchain industry. The company has raised more than $540M USD in funding.

The company Centre claims to be fully transparent about its USD reserves holdings. Each USDC is backed by one USD. USDC stablecoins are issued under the surveillance of licensed and regulated financial institutions to make sure the company has enough reserve holdings.

BUSD

BUSD is the Dollar pegged stablecoins created by Binance in 2019. Binance is the world’s leading and biggest cryptocurrency exchange platform. Binance created BUSD in a partnership with Paxos. Paxos is a NewYork regulated financial institution and blockchain infrastructure platform. There are 1:1 dollars held in Paxos’ bank accounts as collateral against each BUSD.

BUSD is the 13th biggest cryptocurrency by market cap after Avax, Luna, Doge, and Dot. BUSD is very new in the market compared to USDT and USDC but it is catching up very quickly and increasing its share on the market.

UST

UST is a stablecoin in a different way. There is no regulated, centralized financial institution behind it. UST is decentralized stablecoin created on Ethereum by Terra network. It is an algorithm that always keeps the price of a UST equal to 1 USD.

PAXG

PAXG is a stablecoin pegged to Gold prices. Each Paxg’s price is always equal to the price of an ounce of gold. The creator company holds the equivalent amount of gold in their assets and you can look up the allocated assets by their serial numbers.

Types of Stablecoins

Stablecoins are not issued or controlled by government central banks. They are created by independent companies, institutions, and platforms. There are mainly three types of stablecoins.

Fiat Collateralized or Commodity Backed Stablecoins

Those stablecoins prices are pegged to a real-life asset in a 1:1 ratio in price and the issuer company holds an equivalent amount of real asset for each stablecoins created. USD Dollar is the most used asset for stablecoins. The most used stablecoins are pegged to and backed with the USD Dollar.

Crypto Collateralized Stablecoins Those stablecoins are created as a smart contract and they don’t require a real-life asset to be collateralized. Other cryptocurrencies can be used as collateral. The best example of those coins is DAI stablecoin from MakerDAO. DAI is a stablecoin with a price that is always equal to one USD. The platform MakerDAO creates new DAI stablecoins only against crypto collateral. You can use your crypto funds as collateral on the platform and get your DAIs.

Algorithmic Stablecoins

Algorithmic stablecoins don’t require any crypto or non-crypto collateral. They are not backed by any asset but an algorithm. The underlying algorithm creates a stable value and keeps the price stable by controlling the supply of coins.

Disadvantages of Stablecoins

Stablecoins are created by private third parties. Traditional fiat currencies are issued and controlled by government central banks and they are backed by the country’s sovereignty. Central banks are responsible for protecting the value of their currency. But stablecoins are created independently and they are not regulated well. You will most likely use stablecoins if you are involved in crypto buying, selling, and trading. Choose the most comfortable and safest stablecoin for your convenience.